The first is an updated version with the same sized screen, a smaller form factor, and an improved interface. The source told us that Amazon has “skipped three or four generations,” comparing the old Kindle to the 1st gen iPod and the new version to something like the sexy iPod Mini.

This is larger, and about 1/2 a generation different.

The only good part of this is that any significant software upgrades are probably portable to the existing Kindle. Unless they can pull the "not enough memory" Sony excuse.